In reading about the historical Opium situation in China, the silver trade is mentioned again and again. I get the impression that China only accepted silver, even though I have never seen gold mentioned at all.
I am not a scholar, but to my knowledge gold has never been rejected as an exchange medium between large states conducting massive trade with each other, especially if they already accept silver.
At least, until I read about this. China seems to be a curious counter-example.
I read Wiki's article on Opium History in China, which led me to read about the Canton System. That article says:
This trade relationship, where Europeans paid for Chinese products with silver, and silver alone, formed the trade paradigm upon which the Canton System was built.
It has a source, but the wording is slightly different:
As a result, silver was the preferred, and eventually only medium of exchange.
Key-word "eventually". Are there exact dates known, or at least the year, when silver became literally the only accepted payment? This would imply something else was accepted before-hand. Was it gold?
Traditionally gold has been much more valuable than silver, pound for pound. If silver is accepted, then gold should be too, unless there is some significant reason. I am searching for that reason.
I learned that silver mining was very low in China at the time. Therefore silver would be relatively more valuable to the Chinese than to the Europeans. But what about gold mining? Did China somehow have more gold production than silver production, and thus silver was more valuable to them than gold?
I also read that Europe developed a major trade deficit of silver over time. This would imply they sought out and tried other mediums, and in fact is one reason for the Opium Wars. Did they at least try gold? And if so, why was it rejected?
If they never even tried, the question has to be "Would". Otherwise the question has to be "Did".
If necessary I will open related questions about the domestic silver-gold exchange rates that existed in Europe and China at the time.
This article (emphasis mine) discusses the Canton System and its silver requirement:
But it wasn't just any kind of trade: China deliberately (and exclusively) exported value-added, refined products (silk and porcelain) in exchange for exotic raw materials (they lacked sufficient domestic silver supplies)-this is called mercantilism.
Importantly, exporting cloth to Europe supported Chinese workers, and Chinese industries, while importing silver displaced no Chinese industry-
So they got a resource they needed, trading it for value-added items, and threatened no domestic industry.
Another essay here agrees that silver was the main focus of trade with China, though some goods were traded:
The original China trade was a simple bulk exchange of commodities. Until the mid 18th century, 90 percent of the stock brought to Canton was in silver, and the primary export was tea. In 1782, for example, ships carried away 21,176 piculs (1408 tons) of tea, 1,205 piculs (80 tons) of raw silk, 20,000 pieces of “nankeens” (cotton goods), and a small amount of porcelain. After the mid 18th century, the British began shipping large quantities of woolens from their factories to replace the drain of silver bullion, but this was not enough to balance the trade.
It again boils down to demand, the Chinese wanted silver (again emphasis mine):
the giant empire of China in 1800, as the Qianlong emperor boasted, in fact did have nearly all the products it needed within its own borders. It could feed itself, defend itself, and prosper without depending heavily on the outside world. The empire lacked, however, two key commodities: silver and horses. Horses, crucial for military campaigns, had to come from the pastoral nomads of Mongolia and Central Eurasia. The Qing solved this problem by conquering the Mongols in the 18th century and by purchasing large numbers of horses from the Kazakhs. After the mid 18th century, silver, the essential driver of the Chinese commercial economy, was the only scarce major article of trade in China. This was the one key product Westerners could offer, in exchange for tea, silk, and porcelain
Gold is not mentioned as a trade item in any of these sources.
My understanding is that the gold/silver value was different in Europe (~1:12) and in the Far East (~1:6), so it was quite beneficial for European traders to buy everything in Asia using silver and come back with gold and goods.
China was also peculiar in the sense that they wanted essentially nothing from Europeans, feeling they had superior goods in just about every ways. It wasn't until when the opium trade kicked off that Europeans had anything of value besides silver to offer the Chinese.
Source: J.M. Roberts, History of Europe (which has a big bibliography section, where you might find better sources).
Ten Facts About the American Economy in the 18th Century
According to historian Alice Hansen Jones, Americans at the end of the colonial era averaged an annual income of £13.85, which was the highest in the western world. American per capita incomes compared to an average of £10-12 in the British homeland and even lower in France.
The average for free whites came in at approximately £16, whereas indentured servants made roughly £9 and slaves £7. (Of course, most owners did not pay slaves for their labor&mdashtheir income is determined by the market value of the clothing, food, and shelter they received from their owners). When considering only free whites, the South stood as the richest region (with an approximate annual income of approximately&mdash&asymp&mdash£18), followed by the Mid-Atlantic (&asymp£16.55) and then New England (&asymp£12.80). However, when counting the entire population, the Mid-Atlantic came out on top (&asymp£15.79), followed by the South (&asymp£13.63) and then New England (&asymp£12.61).
Abundant natural resources, high wages, and cheap land contributed greatly to Americans&rsquo high standards of living.
2. The average tax rate in colonial America was between 1 and 1.5%
U.S. TAX RATE 1-1.5%
Colonial and Early Americans paid a very low tax rate, both by modern and contemporary standards. Just prior to the Revolution, British tax rates stood at between 5-7%, dwarfing Americans&rsquo 1-1.5% tax rates.
Well into the 19th century, Americans favored &ldquoindirect taxes&rdquo such as import tariffs rather than &ldquodirect taxes&rdquo such as excise taxes (that is, taxes on specific goods like whiskey or paint) or land taxes. While tax rates did climb significantly after the Revolutionary War as states struggled to repay their wartime debts, they came nowhere close to modern rates. That said, Americans received little-to-no government services. Americans constantly lamented their lack of civil services, protection (or lack thereof) on the frontier and high seas, and poor roads and infrastructure.
3. The Depression of the 1780s was as bad as the Great Depression
Between 1774 and 1789, the American economy (GDP per capita) shrank by close to 30 percent. Devastation of real property, a contraction of the labor force due to war deaths and injuries, the cessation of British credit, and exclusion from markets in Britain and West Indies resulted in widespread economic collapse. While the Treaty of Paris in 1783 resulted in a short boom in commercial activity, markets again quickly crashed due to a lack of cash, credit, and markets. New York City merchant Anthony L. Bleeker said in 1786, &ldquoAs money [has] become exceedingly scarce and business very dull, the shopkeepers, country dealers, &c. are very cautious and backwards in buying and it is really very difficult to make sales to any tolerable advantage, especially when immediate payment is required.&rdquo
4. The US&rsquos largest European trading partners in the late 1790s were the German city-states of Hamburg and Bremen
American trade with the Hanseatic city-states of Hamburg and Bremen boomed with upon the outbreak of the Napoleonic Wars. As late as 1792, American commerce with Hamburg and Bremen barely existed, matching that of insignificant trading partners like Norway and Denmark.
However, when the French Revolution broke out in 1793, American merchants quickly made the German ports their principal European entrepôt. Hamburg and Bremen offered a liberal and American-friendly haven in a chaotic and war-torn Northern Europe. American merchants shipped vast cargos of coffee, sugar, and tobacco to the Hanseatic ports in return for German linen and other manufactured goods Unfortunately, a violent financial crisis struck the German city-states in the summer of 1799, leading Americans to take their business elsewhere. Nevertheless, the Hanseatic ports served as the locus of American trade in continental Europe throughout the booming 1790s.
5. Alexander Hamilton executed the first financial bailout in US history in 1791
During the late summer of 1791, the first financial panic in American history erupted in Philadelphia and New York. Fueled by widespread speculation, stock of the new Bank of the United States (BUS) rose from its $25 opening price on July 4 to $312 in Philadelphia on August 11. That same day, the bubble burst in New York and panic quickly spread to Philadelphia, resulting BUS shares losing half their value in less than 48 hours. Facing the prospect of financial and political catastrophe, Treasury Secretary Alexander Hamilton quickly orchestrated the first financial bailout in American history over the weekend of August 13-15, 1791. Through proxies in New York and Philadelphia, the Hamilton Treasury injected a total of $560,000 into financial markets, the 2011 equivalent of between $12.6 and $80 billion. Hamilton had to execute a similar plan just over six months later, when financial markets collapsed again in the spring and early summer of 1792.
6. US cotton exports grew by over 1200% between 1772 and 1804
In the years leading up to the Revolution, cotton production comprised a negligible part of the America economy. With American agriculture focusing on tobacco, wheat, rice, and other cash crops, Americans exported an average of just 29,425 pounds of cotton for the years 1768-1772. Just 30 years later in the period from 1804-1806, Americans shipped 36,360,575 pounds of cotton to markets in Great Britain, continental Europe, and all over the globe. The invention of the cotton gin in 1793 compensated for the high cost of labor in America by allowing one person&mdashmost often a slave&mdashto clean 50 times as much cotton in one day as they would have been able to without it. This technological advancement allowed plantations to produce and process inferior &ldquoupland&rdquo cotton in the vast interiors of the American south.
7. After the Revolution, American traders flocked to the Far East
Before the Revolution, British mercantile regulations strongly discouraged American traders from conducting business with the Far East. British state-sponsored firms like the East India Company held monopolies on eastern commodities like tea and spices, while shipping regulations required that most American goods flow through London or Glasgow before moving on to their ultimate destination.
Independence from Britain abolished those restrictions, and Americans immediately began preparing for trips to India, China, the East Indies (modern day Indonesia), and other locations in the region. The first successful American ship to the Far East, The Empress of China, departed in 1784 and returned a year later with a cargo that yielded $35,000 in profit. While the Far East trade yielded much more hype than actual profit, early American traders became obsessed with the prospect of riches from the China and India. &ldquoWe are mad for India trade,&rdquo New York merchant William Constable wrote on November 5, 1789. For Constable, &ldquomad&rdquo may have been the perfect word. While Far East voyages took up a considerable amount of his time, energy, and resources during the 1780s, Constable&rsquos forays to China and India only resulted in deep losses by the time he quit the trade in 1792.
8. The US did not have an official, state-sanctioned currency until the Civil War
Dating to the earliest North American colonies, specie currency (gold or silver coin) was extremely scarce. While colonies repeatedly issued their own currencies&mdashmost often denominated in (British) pounds&mdashParliament continuously prohibited colonial currency issuances. In some cases, colonies like Virginia used receipts for tobacco and foreign coins&mdashincluding the silver Spanish milled dollar&mdashto alleviate the money shortage.
Upon the advent of the Revolution, Congress tried to repay its debts with the &ldquoContinental Dollar,&rdquo but without the power to tax or mandate its acceptance, the currency quickly lost its value.
The monetary situation did not get much better after the Constitution. While the Constitution prohibited states from issuing their own currencies and subsequent establishment of the Mint set the weight of gold that comprised an official US dollar, most of the new nation&rsquos money supply came from notes issued by individual banks. During the years leading up to the Civil War, hundreds if not thousands of different types notes comprised the nation&rsquos money supply. In fact, several companies in the 1830s published large, illustrated guides that rated and valued all the nation&rsquos bank notes.
9. The US only had 3 banks in 1789
The oldest bank in the United States, Philadelphia&rsquos The Bank of North America, formed in 1781 to finance supply procurement for the Continental Army upon the collapse of the Continental Dollar. Two other banks followed in 1784: the Bank of New York, started by Alexander Hamilton, and the Massachusetts Bank in Boston.
All three institutions took deposits, &ldquodiscounted&rdquo bills of credit&mdashessentially cashed checks for a small percentage of the total value&mdashand provided loans to merchants. Up through the 1780s, state-run &ldquoland banks&rdquo provided mortgages on improved parcels of real property. However, it was not until the establishment of the Bank of the United States in 1791, and the proliferation of its competitors in coastal cities such as Baltimore, Charleston, Savannah, Wilmington, Providence, and Alexandria, that most major American cities had at least one bank. Nonetheless, only 29 banks existed in the United States by the year 1800.
10. Women played a critical role in shaping the Early American Economy
While women faced legal strictures that masked their participation in the early American economy, they shaped the consumer market and provided the investment that stabilized government financial and propelled industry. As the most common purchasers of household items, women&rsquos tastes dictated which goods merchants imported and sold in shops and that farmers brought to market. Women also drove production by managing plantations, shops, and even iron foundries. Perhaps even more important, women invested in land, stocks, and US government bonds. In fact, during the 1790s women executed at least 10% of all financial transactions, including complex stock deals and debt speculation schemes.
About the Author
Scott C. Miller
Ph.D Candidate, American Economic and Business History Corcoran Department of History University of Virginia Full Bio
The First President
Washington's Presidential Cabinet
While the current presidential cabinet includes 16 members, George Washington&rsquos cabinet included just 4 original members: Jefferson, Hamilton, Knox, and Randolph.
In 1791, Congress approved a new, federal tax on spirits and the stills that produced them which sparked a conflict that threatened Washington's new government.
Did the Gold Standard Work? Economics Before and After Fiat Money
Suddenly gold is being proposed as a cure-all for the weakening dollar, allowing it to retain its place as the international reserve currency — a trophy taken, not without a fight, from the British pound at the Bretton Woods conference in 1944. Predictably, many commentators are reducing the most sophisticated, technical economic issues to a paella of nationalism, confusion about basic economic facts, and old-fashioned avarice.
To help throw up some light, let’s start with the simple questions: How is a classical gold standard supposed to work? How did it actually work out in the past? Why did previous versions of the international reserve currency lose their mantle? What is the record of the fiat currency version of the dollar as an international reserve currency? And why is it now rather than some other moment that gold is so much discussed?
The Classical Gold Standard
In the classical gold standard, the domestic money supply is directly tied to a country’s stock of gold. The theory was first enunciated by David Ricardo and can be traced to the founder of economics, Adam Smith, whose motivation was to avoid any impediment to the increased efficiency of production and the sacred tenet of the international division of labor.
Under an international gold standard mechanism, the gold-linked note issue of a country experiencing a loss of gold due to a trade deficit would be automatically contracted, depressing the price level. The deficit country’s exports would then become more attractive to foreign countries whilst imports would become more expensive thereby self-correcting the deficit. Global imbalances were automatically restrained by credit expansion in surplus countries and contractions in deficit countries.
Classical economists in the heyday of the gold standard were interested in increasing the international efficiency of production, which needed the elimination of at least one variable, the volatile prices of input and output of goods which the standard encouraged (the price of labor proved to be rather stickier). On one intuitive level, the standard was seen as preventing the moral injustice of inflation eating into the savings of the dominant class and encouraging the supply of goods and food for the fast-growing population, which the Reverend Thomas Malthus famously condemned as the result of a lack of “moral restraint.”
Under a classic gold standard, exchange rates are fixed, and so any deviation of domestic price levels from the world gold price triggers the alarm of exports and imports of physical gold before things move too far from equilibrium. If Canada enjoys a trade surplus, gold flows in automatically from its trading partners who run up deficits. Canada’s money supply is expanded by the inflowing gold, which will tend to cause inflation, self-correcting declines in exports due to higher prices for non-Canadians and to Canada’s citizens having more money to spend on imports, eventually correcting the surplus. Deficit countries are prevented from consuming the part of their production that they will need for exports in order to rebalance.
How Did the Classical Gold Standard Actually Work in Practice?
For the most part, the answer seems to be things turned out pretty badly. Its heyday as common currency for the British Empire in the later part of the 19th and early 20th century was interrupted by the First World War. Even before then the mechanism had been tested by support for bimetallist alternatives to crucifying “mankind upon a cross of gold,” as William Jennings Bryan put it, and the 1880s trade depression with its attendant evils of the exhaustion of gold stocks and an explosion of gold hoarding (more below on this below).
American cartoon by Grant Hamilton, 1896, on William Jennings Bryan’s “Cross of Gold” speech at the Democratic National Convention in Chicago, which won Bryan the presidential nomination.
In 1914 the mechanism for international payments dramatically collapsed. Half of world trade was financed by British credits — which, with stock markets mostly shut for the duration of the war, meant bills could not be rolled over or paid with the usual ease. Over the summer of 1914, defaults gradually gummed up the discount and acceptance markets, and a run on the Bank of England’s gold facility led to a suspension of specie payments.
Fast forward to the interwar period, and it seems there is an echo in the room. A gold exchange standard, not quite the same thing as a classical gold standard — “based on national hoarding and cross-border diplomatic haggling,” as Benn Steil described it — was patched together in the 1920s. But this failed to survive the monetary and trade chaos of the 1930s. Some argue this is because it wasn’t as strict as the classical gold standard resembling more a highly margined derivative instrument. Administrators also had the nasty habit of checking only outflows not inflows of gold.
Yet the attraction of gold endured. Perhaps it is the notion of a fixed monetary supply to curb the natural human instinct to spend. It emerged that the British and their pound, then the international reserve currency, had returned to the gold standard after the war at too high a rate, prompting a violent depression. Successive British and other governments on the standard effectively committed themselves to making it more expensive to foreigners to buy their goods, inflicting (perhaps on class grounds) the hair shirt of suffering on the teeming hordes of unemployed and struggling exporters.
There were some successes in several countries, France and the surplus countries for example, and the Federal Reserve’s “King Midas” policy of sterilizing gold inflows was initially quite successful. But soon, the keystone principle of international division of labor came to be regarded as an overrated encumbrance. In the face of the Great Depression, unsuccessful trade restrictions, stubborn unemployment, and political meltdowns, the gold standard collapsed again in 1933. The United States went off the gold standard at a time when the metal was being extensively hoarded by citizens spooked by the collapse of about half of the nation’s banks.
A telling footnote to the end of the US gold standard interwar experiment is Franklin D. Roosevelt’s unique and possibly unconstitutional method of economic management to bolster the gold price and help American producers of gold denominated goods:
From his bed each morning, Roosevelt would, after briefly conferring with his advisers, set a daily target for bumping up the gold price, not always through scientific methods. One day, November 3rd, the president suggested that gold should go up twenty-one cents. “It’s a lucky number” he explained, “three times seven.”
In choosing the path of national currency management, Roosevelt was rejecting the contradictions of a gold standard mechanism under the pressures of his times and also setting out his stall against economic internationalism in favor of several other “isms”: isolationism or at most bilateralism. He decided to ban gold hoarding and shifted control of reserves to Washington too.
The Battle of Bretton Woods: An International Reserve Currency Gets Ditched
As the Second World War reached its bloody conclusion, negotiators of the purse strings of the United States and its allies, notably Great Britain, met with ever-increasing urgency to try and agree on financial arrangements for a new world after the war. No one, aside from politically irrelevant (and not yet liberated) France, suggested a return to the gold standard.
Instead two competing global plans, were fought over between erstwhile allies Britain and America. The British, with their Imperial Preference system favoring trade within their Empire block were deeply distrusted by Roosevelt: “When you sit around with a Britisher he usually gets 80 per cent of the deal,” he growled.
Storied economist John Maynard Keynes led the British delegation and argued unsuccessfully for an International Clearing Union, which would allow members to have some control over their exchange rates. Keynes wanted everything based around one theoretical supracurrency with gold subscriptions limited to a small percentage of country quotas. The British also needed a giant bank overdraft to prop up their sagging empire and trade deficits, but struggled to convince the Americans they were worthier allies than Stalin’s Russia.
Harry Dexter White, representing America, argued for a stabilization fund of fixed sterling dollar exchange rates, limited liability for America, control over gold-backed dollars by Congress, and a fund structure rather than that of a bank. White, who was later found to be involved in spying for Russia, essentially schemed to limit the growth of British reserves and undermine the imperial trading block in order to help American traders.
The battle between Keynes, seeking “natural justice” for the disproportionate sacrifices Britain had endured to defeat Nazisim, and White, gunning for American-Soviet interests, is ably related in Benn Steil’s new book. Steil concludes that, “The British had been anxious to see themselves as partners with the Americans in creating the ground rules for the postwar order, yet at every step to Bretton Woods the Americans had reminded them, in as brutal a manner as necessary, that there was no room in the new order for the remnants of British imperial glory.”
Aside from setting up the IMF and sowing the seeds of the World Bank, the Bretton Woods Agreement made the US dollar, with its comforting gold reserves, the only gold convertible currency. Whilst every other currency could devalue against the dollar, the dollar could only devalue against gold.
Nevertheless, British insistence on preserving monetary sovereignty which permitted unilateral exchange rate changes even if unauthorized, made the IMF, which grew out of Bretton Woods, something of a “toothless tiger.” Opt-outs and transition periods of indeterminate length, amongst other things, prevented a full implementation of the Bretton Woods Agreement.
Yet Another Failed Gold Exchange Standard
By 1971, “the dollar was in essence the last ship moored to gold, with all the rest of the world’s currencies on board, and the United States was cutting the anchor and sailing off for good,” according to Steil. Nixon’s inflationary administration, overspending in Vietnam, asked the markets the question: Could an abundant dollar remain tied to gold even when stocks of gold had declined to lamentable levels? The answer was no. Attempts were made to revive it in 1973 through the G10, but nothing came of it. The fiat dollar was now king.
So Could an International Monetary System Be Made to Work without Gold?
The fiat money system based on paper notes, not gold backing, does have a number of advantages. Milton Friedman embraced the political reality that holding a gold standard together in endless international conferences was chimerical. The advantage of allowing the market to determine the level of the dollar against other currencies is that it frees policymakers to focus on national economic objectives rather than their balance of payments. The gold standard evil of unilateral exchange rate depreciation might not be such a big deal after all. On the other hand, Friedrich Hayek did not share Friedman’s view of floating exchange rates, believing the consequence would be volatile capital flows.
After Nixon closed the gold window, radical alternatives to the fiat money system based around international money, a revived gold standard, or private money competition were simply not congenial to governments, particularly the United States according to Steil’s telling of recent history. By the 1980s Friedman was in the ascendant with Paul Volcker acting to raise interest rates to almost any level and at any cost that would lower inflation.
The Great Moderation in the Greenspan era seemed to prove that gold was indeed a “barbarous relic,” just as Keynes had said. In the 1990s central banks even sold off large portions of their gold stocks driving the price down to $290 per ounce.
Why the Talk of a Return to the Gold Standard?
Working against a return to the gold standard today is a sickly combination of dollar deficiencies, a mountainous US trade deficit, the parallel mountain of Chinese surpluses, undervaluation of the Chinese currency, pressure from competitive devaluations in competing currencies, and the emergence of regionally significant political blocs.
What is different now from 1944, is that there isn’t any dominant leader-nation to coordinate such a shift, China is not ready for that role, and there has so far been no event big enough to prompt it. Which nation can tell China, Japan, Germany, and the emerging markets what to do with their surpluses and boss around the deficit countries too?
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All posts are the opinion of the author. As such, they should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute or the author’s employer.
Trade goods for the slave trade
A ship going to Africa to buy slaves carried a large cargo of mixed goods, such as cotton, brass pans and guns. These were exchanged for enslaved Africans, who were shipped across the Atlantic Ocean to north and south America and the Caribbean. Here they were set to work on the plantations (large areas of land owned by Europeans where crops were grown). The shipsâ€™ captains would buy goods to take back to Europe. These would be goods produced by slave labour on the plantations. They were tobacco, sugar, indigo (a plant used for dye), rice, rum and cotton.
The trade goods used for buying enslaved Africans were often produced and sold locally around Bristol. Pictured here is an entry in the catalogue of stock in a Bristol shop selling cutlery and hardware, it reads â€˜Articles suitable to the African Tradeâ€™.
But local industries did not always produce the goods which African buyers wanted. Traders in Bristol therefore had to buy products from elsewhere to trade with Africa. For example they bought cotton cloth from India (from a trading company, the East India Company, in London), or from traders in Manchester. Guns were mostly bought from the makers in Birmingham, but gunpowder was made in Bristol. The African traders, with whom the Bristol traders were doing business, wanted goods which were not available in Africa. They would have particular requirements for different types of fabric, for example, and would find a trading partner who could provide it. Copper was highly prized by West Africans: it has been called the â€˜red gold of Africaâ€™. African traders therefore happily accepted brass items, brass being an alloy or mix of copper and zinc. They would buy it from European traders in blocks, which could be melted down to make decorative items. Europeans made brass â€˜manillasâ€™, which was brass moulded into a bracelet shape. These became a form of money in West Africa. African traders would also buy items made from brass for everyday use, such as the one pictured here. Bristol had an important brass industry. Much of the brassware produced in Bristol was sold to slave traders for the African market.
Glass beads, such as those shown here, were used to trade with Africans. The beads had to be bought abroad for sale to Africa. The main suppliers were the city of Venice in Italy and Bohemia (in what is today Czechoslovakia). Beads were available in many sizes, shapes and colours. A European slave trader could be caught out by a change in fashion and find that the beads he had chosen were no longer wanted by his African trading partner. The Bristol ship the Africa in 1774 was left with a large quantity of unsold beads.
The involvement of Bristol in the Africa trade boosted industry in and around the city. Gunpowder, glass, pottery, woollen cloth, iron and brass pans went to Africa and all were produced locally. Without the transatlantic slave trade , local industry would not have had such a big market and been so profitable.
Embroidery history - The Eighteenth Century
The general type of work done during the 17th Century was still used in the 18th, but as time went on embroidery became much more naturalistic in character until eventually the imitation was such that the essential qualities of the needlework resembled brush work.
The great variety of natural objects. flowers, trees, birds, animals and insects. were often worked on the same piece of cloth. The growth of trade with China and the far East brought an influence in design and birds with wonderful plumage and flowers resembling the lotus and chrysanthemum were introduced alongside the traditional English forms.
Household items such as hangings and coverlets were embroidered in much the same way as in the previous century of embroidery history, however, there was a change from worsteds to silks and in addition, there was a great interest in embroidery in relation to furniture.
Chair and stool covers were worked in cross stitch, and needlepoint stitches known as petit point and gros point.
Both men's and women's costumes were decorated with sprigs and borders, finely embroidered flowers and leaves, often with the addition of metal threads. These were usually worked in satin stitch or long and short stitch.
5. Chinoiserie is related to the Rococo style
Both styles are characterized by exuberant decoration, a focus on materials, stylized nature, and subject matter depicting leisure and pleasure.
Chateau de Chantilly. The Apartments of the Princes of Condé The Cabinet of chinoiserie. Nymphenburg Palace, Munich, Germany. Credit Yelkrokoyade 1745 Nécessaire with watch. German. Gold and mother-of-pearl, lined with dark-red velvet. metmuseum 1745 Nécessaire with watch. German. Gold and mother-of-pearl, lined with dark-red velvet. metmuseum 1745 Nécessaire with watch. German. Gold and mother-of-pearl, lined with dark-red velvet. metmuseum 1735 Wall clock. French. Étienne LeNoir. Soft-paste porcelain and partly gilded brass. metmuseum
Exotic chinoiserie accents in the pagoda-shaped outline of the tureen’s lid exemplify an interpretation popular in southern Germany.
1771 Tureen and stand. Silver, silver gilt. German, Augsburg. metmuseum
Oil palm–human relations in West Africa: a long history
For thousands of years, the oil palm – indigenous to West Africa – has had an intimate relationship with humans. An explosive expansion of oil palm groves throughout western and central Africa in the wake of a dry period around 2,500 years ago enabled human migration and agricultural development in turn, humans facilitated oil palm propagation through seed dispersal and slash-and-burn agriculture. Archaeological evidence shows that palm fruit and kernels and their oil already formed an integral part of West African diets 5,000 years ago.
Oil palms were not only protected as a valuable crop, they also grew well in cleared and burned areas. Abandoned villages and farm camps often became prominent palm oil groves even today the age and distribution of oil palms can help easily identify old settlements. With the exception of “royal” oil palm plantations, established in the 18th century for palm wine in the Kingdom of Dahomey, all of West Africa’s oil palms grew in such wild and semi-wild groves.
Women and children collected loose fruits from the ground, while young men harvested fruit bunches by climbing up to the top of the palms. The fruit was then processed into palm oil by women, through a time-consuming and labour-intensive process involving repetitively boiling and filtering the fresh fruits with water – similar methods are still largely used throughout West Africa. While pure red palm oil was derived from the palm fruit’s fleshy outer mesocarp, women also, often with the help of children, cracked the palm kernels to make brown, clear palm kernel oil.
Palm oil was, and remains, a key ingredient in West African cuisine, such as that of southern Nigeria: from the simple dish of boiled yam, palm oil and Kanwa salt, to Banga soup made from the mashed fruit left over during palm oil processing and many other “soups” eaten with pounded yam or garri (ground cassava).
Throughout West Africa, palm oil was also used in soap making today Yoruba black Dudu-Osun soap is a trademark Nigerian brand. In Benin Kingdom, palm oil was used in street lamps and as a building material in the king’s palace walls. It also found hundreds of different ritualistic and medicinal uses, in particular as a skin ointment and a common antidote to poisons. In addition, the sap of oil palms was tapped for palm wine, and palm fronds provided material for roof thatching and brooms.
Ashanti Empire Trade Slaves for Guns
In the late 17th century, the Akan people of modern Ghana started to transform their small chiefdom into an empire which they called Ashanti (Ashante or Asante). They expanded their territories by waging war with neighboring peoples and soon captured many prisoners of war. These captives were then sold off to European slave traders who would take them to the plantations in the Americas and West Indies. Starting in the early 18th century, however, the Ashanti Empire started to accept guns in lieu of gold as payment for every slave they sold to European traders. These events are recorded on the Biblical Timeline Poster with World History around this time.These Articles are Written by the Publishers of The Amazing Bible Timeline
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The Rise of the Ashanti Empire
During the 1670s, groups of Akan people from northern Ghana escaped strife in their homeland and flocked to the fertile region around Kumasi. Two of the most powerful clans that migrated to Kumasi were the Bretuo and the Oyoko. At that time, however, the refugees were forced to submit to the powerful Denkyira nation.To assure the Denkyira of his people’s submission, the Oyoko chief Obiri Yeboa sent his nephew Osei Tutu to live with and serve the m .
Osei Tutu served as a shield bearer to Boa Amponsem, the chief of the Denkyira. He later fled to the territory of the Akwamu because of the cruelty of the people he served. He worked for the Akwamu chief and quickly rose to prominence there. He also befriended the priest Okomfo Anokye who soon became his firm ally. His uncle, chief Obiri Yeboa, later died in battle, so Osei Tutu was summoned back to his homeland to rule. He continued the conquests made by his uncle and even subdued other groups of Akan people in the area.
Osei Tutu, with the help of Okomfo Anokye and his Akwamu allies, slowly built the Ashanti kingdom. During the 1690s, Osei Tutu and his people declared their independence from the Denkyira. Full-scale war flared out between the Denkyira and the Ashanti in 1699, but the Ashanti emerged victorious in 1701 in the Battle of Feyiase.
Slaves , Gold, and Guns
In the middle of the 15th century, the first slave ships sailed from Lisbon and docked off the coast of northwestern Africa. The crew then came to land and captured unsuspecting natives which were then sold off as slaves in the markets of Lisbon. The slave trade turned out to be so profitable that Spanish, English, and Dutch ships soon followed Portugal’s lead.
As the years passed, European trade ships sailed deeper into the coast of western Africa to acquire more slaves and gold. The coast of modern Ghana became one of the chief ports of these trades that it was soon divided into the Gold and Slave Coasts. Dutch slave traders outdid the Portuguese in the 17th century, but they were replaced by the English by the time the Ashanti were building their empire.
The Ashanti’s long-time ally, the Akwamu, were among the first ones to profit from the slave trade with the Europeans. Their captives were almost always prisoners of war, but they were not above to selling Akwamu men who offended the chief. They also kidnapped able-bodied men from other tribes and sold them in the coastal slave markets.
The Ashanti soon joined in the slave trade by kidnapping traveling men or even those who were just working on their farms. They also went to war with neighboring peoples (especially in the Black Volta and savanna regions) not only to expand their territory but also to acquire more slaves which they then sold to Dutch and English traders. This practice had become so profitable that by 1720 the Slave Coast of Ghana had eclipsed the Gold Coast.
A vicious cycle soon emerged from this business. The Ashanti initially accepted gold as payment for slaves, but soon preferred flintlocks, muskets, and gunpowder as payment. With these weapons in hand, Ashanti warriors would then subdue another group of people and sell the captives of war to the European as slaves. By 1730, as much as 180,000 European-made firearms had been shipped to the Slave Coast and handed to the natives.
Harms, Robert W. The Diligent: A Voyage Through the Worlds of the Slave Trade . New York: Basic Books, 2002.
Rodney, Walter. The Cambridge History of Africa: From c. 1600 to c. 1790 . Edited by Richard Gray. Vol. 4. Cambridge: Cambridge University Press, 1975.
Act of Union 1707
The Union between Scotland and England may have created the Great Britain we know today - but at the time it was one of the most unpopular political moves ever to have taken place north of the border.
Ordinary Scots were incensed at what they saw as a stitch up designed to line the pockets of the country's most powerful men - and their judgment was absolutely right.
For Scots parliamentarians, the Act of Union in 1707 was a golden opportunity to pull their country out of dire economic poverty while at the same time lining their own pockets with money.
The English had different goals. They wanted to solve the problem of their troublesome northern neighbour once and for all while at the same time ensuring that the so-called union ended up as a takeover rather than a merger. And they got exactly what they wanted.
After the disaster of the Darien adventure, Scotland was the poorest country in Europe - a situation made worse by the English policy of deliberately blocking Scottish trade when it threatened England's own interests.
By the beginning of the 18th century, the two countries had gradually been moving closer to each other for 100 years, with the union of the crowns in 1603 and the short period of union under Cromwell's Commonwealth. But there was still no love lost between them, and still no inevitability they would join to form one nation.
However, the disastrous Darien adventure had taught Scots an important lesson. It made it clear that there had to be come sort of accommodation which would allow the two countries to pursue similar foreign and economic policies, since England could clearly scupper Scottish trade ambitions whenever it wanted.
The first concrete move towards union came when Queen Anne took the thrones of Scotland and England in 1702. The previous year, the English parliament had passed an Act of Settlement passing the crown to the German house of Hanover on the childless Anne's death.
The Scottish parliament was not consulted about the decision, and had also been angered by a war between England and its own traditional ally, France, which was affecting trade. It refused to pass the same act. Anne hoped that a political union between the two countries could solve the problem.
The Queen's Commissioner in Scotland, the Duke of Queensberry, managed to get a bill through the Scottish estates nominating commissioners to begin discussions with the English about union. But it fell flat when the English commissioners refused even to turn up.
A new parliament was elected in Scotland in 1703, but it was more radical than its predecessor, with many members prepared to choose their own Scottish monarch instead of Anne. It passed an Act of Security which allowed Scotland to decide on its own succession. In a further act of defiance against England's war with France, it then passed another act giving it a role in saying whether the monarch declared war or sued for peace.
At the same time, the English were becoming deeply worried about the new nationalist mood in Scotland, which they saw as a resurgence of Jacobitism. They discovered that the French were supporting the Jacobites, and decided to take their own steps to try and force a union.
The English parliament passed draconian legislation known as the Alien Act, which threatened to make all Scots who were not resident in its own territories or serving in its armed forces aliens. It also threatened to take drastic action against exports of linen, coal and cattle from Scotland to England.
The Scots were given a let-out - if they agreed to either accept the Hanoverian succession or enter into serious negotiations about union within 10 months, the proposals would not be enacted.
Scots were furious about the threats, but quickly realised how serious their problems would be if they did not comply. The Scottish Estates again decided to discuss appointing commissioners to discuss union.
The treachery of one of the country's leading nobles, the Duke of Hamilton, was instrumental in what happened next. Hamilton, who had been a virulent anti-unionist, suddenly switched sides after secretly being bribed by the English. His fellow anti-unionists walked out in protest, and a decision was voted through to allow the Queen to appoint the Scottish commissioners who were to meet with the English and discuss union.
Hamilton's move had a major impact - it effectively meant there would not be hard bargaining on Scotland's behalf, but that Anne was guaranteed the deal she wanted, with the interests of Scots well down the list of priorities.
There was, however, still a final hurdle - the decision to unite the two countries still had to get through the Scottish parliament. The English again used bribery, promising Scots jobs in the new government and handsome pensions if they supported union. It was an offer many felt they could not refuse.
Slowly but surely, the commissioners thrashed out a deal and put a treaty together. It was decided that the newly merged kingdoms would be called Great Britain, and that there would be a single, Hanoverian, Protestant sovereign. There would be one flag, one currency and free trade would be allowed under a single set of customs regulations.
There would, of course, also be a single parliament. It was eventually decided that Scotland should have 45 MPs and England 513 MPs in the new House of Commons. In the Lords, Scotland would have 16 seats and England 196. In other words, the Scots were so few in number as to be virtually unnoticeable.
Scotland did win some concessions during the talks - it managed to keep its own legal system, and the place of the Kirk and the retention of the distinctive Scottish education system were guaranteed.
One of the most important provisions, however, was the Equivalent - the sum of money paid by England to Scotland as compensation for Scots taking a share of the £14 million English national debt.
The cash, which was also used to compensate investors in the Darien scheme, was another bribe, because much of the money, which came to nearly #400,000 in total, went into the pockets of those Scots with the power to influence, or vote directly on, the new union.
When the terms of the deal became known, ordinary Scots were incandescent with rage. There were riots in Glasgow and Edinburgh. In the Estates, however, the mood was very different. The anti unionists realised that they were losing the argument. Too much English money was changing hands, and too many plum jobs in the new Great Britain administration were being offered.
The crunch came on 16 January 1707, when the Estates finally passed the act consenting to the Articles of Union. The vote was decisive: 110 members in favour, only 67 against. Scotland's independence had been voted into the history books.
The Scottish parliament adjourned itself on March 19, and the Act of Union came into existence on May 1 of that year. For many Scots - particularly those who had fought so hard to resist the merger - it was an emotional moment.
On the day the new Great Britain came into effect, the church bells of St Giles in Edinburgh tolled out the tune How Can I Be Sad On My Wedding Day? The Chancellor of Scotland, the Earl of Seafield, made an equally poignant statement, bitterly describing the union as "An end of an auld sang".
Later that century, Scotland's most famous poet, Robert Burns, was to make his own eloquent comment on the way in which Scotland's noblemen allowed their country to be bribed out of existence. "Bought and sold for English gold", he wrote. "Sic a parcel of rogues in a nation."
The classical Gold Standard
The Gold Standard was a system under which nearly all countries fixed the value of their currencies in terms of a specified amount of gold, or linked their currency to that of a country which did so. Domestic currencies were freely convertible into gold at the fixed price and there was no restriction on the import or export of gold. Gold coins circulated as domestic currency alongside coins of other metals and notes, with the composition varying by country. As each currency was fixed in terms of gold, exchange rates between participating currencies were also fixed.
Central banks had two overriding monetary policy functions under the classical Gold Standard:
- Maintaining convertibility of fiat currency into gold at the fixed price and defending the exchange rate.
- Speeding up the adjustment process to a balance of payments imbalance, although this was often violated.
The classical Gold Standard existed from the 1870s to the outbreak of the First World War in 1914. In the first part of the 19th century, once the turbulence caused by the Napoleonic Wars had subsided, money consisted of either specie (gold, silver or copper coins) or of specie-backed bank issue notes. However, originally only the UK and some of its colonies were on a Gold Standard, joined by Portugal in 1854. Other countries were usually on a silver or, in some cases, a bimetallic standard.
In 1871, the newly unified Germany, benefiting from reparations paid by France following the Franco-Prussian war of 1870, took steps which essentially put it on a Gold Standard. The impact of Germany’s decision, coupled with the then economic and political dominance of the UK and the attraction of accessing London’s financial markets, was sufficient to encourage other countries to turn to gold. However, this transition to a pure Gold Standard, in some opinions, was more based on changes in the relative supply of silver and gold. Regardless, by 1900 all countries apart from China, and some Central American countries, were on a Gold Standard. This lasted until it was disrupted by the First World War. Periodic attempts to return to a pure classical Gold Standard were made during the inter-war period, but none survived past the 1930s Great Depression.
How the Gold Standard worked
Under the Gold Standard, a country’s money supply was linked to gold. The necessity of being able to convert fiat money into gold on demand strictly limited the amount of fiat money in circulation to a multiple of the central banks’ gold reserves. Most countries had legal minimum ratios of gold to notes/currency issued or other similar limits. International balance of payments differences were settled in gold. Countries with a balance of payments surplus would receive gold inflows, while countries in deficit would experience an outflow of gold.
In theory, international settlement in gold meant that the international monetary system based on the Gold Standard was self-correcting. Namely, a country running a balance of payments deficit would experience an outflow of gold, a reduction in money supply, a decline in the domestic price level, a rise in competitiveness and, therefore, a correction in the balance of payments deficit. The reverse would be true for countries with a balance of payments surplus. This was the so called ‘price-specie flow mechanism’ set out by 18th century philosopher and economist David Hume.
This was the underlying principle of how the Gold Standard operated, although in practice it was more complex. The adjustment process could be accelerated by central bank operations. The main tool was the discount rate (the rate at which the central bank would lend money to commercial banks or financial institutions) which would in turn influence market interest rates. A rise in interest rates would speed up the adjustment process through two channels. First, it would make borrowing more expensive, reducing investment spending and domestic demand, which in turn would put downward pressure on domestic prices, enhancing competitiveness and stimulating exports. Second, higher interest rates would attract money from abroad, improving the capital account of the balance of payments. A fall in interest rates would have the opposite effect. The central bank could also directly affect the amount of money in circulation by buying or selling domestic assets though this required deep financial markets and so was only done to a significant extent in the UK and, latterly, in Germany.
The use of such methods meant that any correction of an economic imbalance would be accelerated and normally it would not be necessary to wait for the point at which substantial quantities of gold needed to be transported from one country to another.
The ‘rules of the game’
The ‘rules of the game’ is a phrase attributed to Keynes (who in fact first used it in the 1920s). While the ‘rules’ were not explicitly set out, governments and central banks were implicitly expected to behave in a certain manner during the period of the classical Gold Standard. In addition to setting and maintaining a fixed gold price, freely exchanging gold with other domestic money and permitting free gold imports and exports, central banks were also expected to take steps to facilitate and accelerate the operation of the standard, as described above. It was accepted that the Gold Standard could be temporarily suspended in times of crisis, such as war, but it also was expected that it would be restored again at the same parity as soon as possible afterwards.
In practice, a number of researchers have subsequently shown  that central banks did not always follow the ‘rules of the game’ and that gold flows were sometimes ‘sterilised’ by offsetting their impact on domestic money supply by buying or selling domestic assets. Central banks could also affect gold flows by influencing the ‘gold points’. The gold points were the difference between the price at which gold could be purchased from a local mint or central bank and the cost of exporting it. They largely reflected the costs of financing, insuring and transporting the gold overseas. If the cost of exporting gold was lower than the exchange rate (i.e. the price that gold could be sold abroad) then it was profitable to export gold and vice versa.
A central bank could manipulate the gold points, using so-called ‘gold devices’ in order to increase or decrease the profitability of exporting gold and therefore the flow of gold. For example, a bank wishing to slow an outflow of gold could raise the cost of financing for gold exporters, increase the price at which it sold gold, refuse to sell gold completely or change the location where the gold could be picked up in order to increase transportation costs.
Nevertheless, provided such violations of the ‘rules’ were limited, provided deviations from the official parity were minor and, above all, provided any suspension was for a clear purpose and strictly temporary, the credibility of the system was not put in doubt. Bordo  argues that the Gold Standard was above all a ‘commitment’ system which effectively ensured that policy makers were kept honest and maintained a commitment to price stability.
One further factor which helped the maintenance of the standard was a degree of cooperation between central banks. For example, the Bank of England (during the Barings crisis of 1890 and again in 1906-7), the US Treasury (1893), and the German Reichsbank (1898) all received assistance from other central banks.
 Bloomfield, A., Monetary Policy Under the Gold Standard, 1880 to 1914, Federal Reserve Bank of New York, (1959) Dutton J., The Bank of England and the Rules of the Game under the International Gold Standard: New Evidence, in Bordo M. and Schwartz A., Eds, A Retrospective on the Classical Gold Standard, NBER, (1984)
 Bordo, M., Gold as a Commitment Mechanism: Past. Present and Future, World Gold Council Research Study no. 11, December 1995